"Guitar Hero" Becomes a Music Store

It took Apple (Nasdaq: AAPL  ) iTunes five years to go from nothing to beating Wal-Mart (NYSE: WMT  ) as America's leading music store. Will we look back, five years from now, and ruminate about Activision's (Nasdaq: ATVI  ) rise to the top of that heap?

I'm asking because the company's smash hit Guitar Hero franchise will add music publishing features in its next incarnation. Guitar Hero World Tour intends to improve on Guitar Hero III in several important ways, including downloadable content for Nintendo (OTC BB: NTDOY.PK) Wii owners and a full band setup with drums and vocals, much like the Rock Band rival.

But the upgrade with the biggest potential earnings impact supplies the ability to record, edit, and share your own playable songs through the game. This taps into the creative urges awakened by a good air-guitar session, and then gives us a way to be a real rock star.

Each players gets to upload five songs to begin with, but other gamers get to rate your songs, and that quota will be raised for the most-appreciated contributors, according to a preview of the game in Game Informer magazine.

It's a touch of iTunes and a smidgen of Facebook or News Corp.'s (NYSE: NWS  ) MySpace, all wrapped up in a successful game franchise and a whole lot of rock 'n' roll. This will extend the shelf life of the game itself considerably and should boost initial demand a bit as well. The earnings model for downloads is unclear at the moment, but I'd be surprised if the content was entirely free.

And I expect nothing but top-shelf material in World Tour at launch, as the bands must have seen the marketing value in these silly games by now. Van Halen, Linkin Park, Sublime and The Eagles are showing up in person, and there will be no cheesy cover versions of the hits. Now let's see how they use this new publishing platform!

A-one and a-two ...

Further Foolishness:

Wal-Mart Stores is a Motley Fool Inside Value pick. Nintendo, Activision, and Apple are recommendations of our fun-loving Stock Advisor newsletter. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Anders Bylund holds no position in any companies discussed here, but has worn down the fret buttons on his plastic guitar. You can check out Anders' holdings if you like, and Foolish disclosure is hoping for some "Santeria" and "Hotel California" action.


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  • Report this Comment On May 22, 2008, at 6:58 PM, esxokm wrote:

    This is going to be one interesting battle of the bands between ATVI and ERTS/VIA.

    Guitar Hero enthusiasts will have so much more to do with this new upgrade. Be fun to watch how many people adopt World Tour and how many adopt Rock Band this Christmas.

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